EUR/USD Forecast – Euro Might Correct Lower Vs US Dollar

EUR/USD Forecast – Euro Might Correct Lower Vs US Dollar

  • – The Euro traded towards the 1.1840 level recently before correcting lower against the US Dollar.
  • – There was a break below a major ascending channel with support at 1.1810 on the hourly chart of EUR/USD.
  • – Recently in the US, the Consumer Credit report for April 2018 was released by the Board of Governors of the Federal Reserve.
  • – The outcome was below the market forecast of $13.75B as the Consumer Credit change came in at $9.26B.

US Consumer Credit Change

Recently in the US, the Consumer Credit report for April 2018 was released by the Board of Governors of the Federal Reserve. The market was looking for a change in the credit by $13.75B, more than the last change of $11.62B.

 

The actual result was below the market forecast of $13.75B as the Consumer Credit change came in at $9.26B. Moreover, the US initial jobless claims also posted a decline from the last revised reading of 223K to 222K for the week ending June 2.

 

The EUR/USD pair is currently correcting lower and it may decline further towards the 1.1760 and 1.1750 levels in the near term.

 

EUR/USD Technical Analysis

The Euro gained traction this week from the 1.1650 low against the US Dollar. The EUR/USD pair moved higher and traded above a couple of important resistance levels such as 1.1700 and 1.1750 to place itself well above the 100 hourly simple moving average.

 

EUR/USD Technical Analysis Euro US Dollar

 

The pair even broke the 1.1800 level and traded as high as 1.1838. Later, a downside correction was initiated and the pair declined below the 1.1820 and 1.1800 levels. There was also a break below the 23.6% Fib retracement level of the last wave from the 1.1714 low to 1.1838 high.

 

More importantly, there was a break below a major ascending channel with support at 1.1810 on the hourly chart of EUR/USD. At the moment, it seems like the price may continue to decline towards the 1.1770-60 support zone in the near term.

 

On the downside, the 50% Fib retracement level of the last wave from the 1.1714 low to 1.1838 high could act as a support around 1.1770. Below this, the next support sits around the 1.1740 and 1.1730 levels.


Also published on Medium.

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